Jerk in the Box marketing!

[El Presidente]

One question I would ask to El Pres, is what exactly do you mean by the 'current situation' not being allowed to drift on. Is there some major cull or overhaul planned, or is it just an annual review?

Nothing concrete. I know last year 12 cigars were saved from the "cut" list and I can only forsee the pressure this year to be even more. Sancho Panza survived by the skin of its teeth. Quai D'Orsay was another.

Personally I would cut:

Monte Open (...if you cut now HSA people may only remember it as a bad dream)

Vegueros (Sorry Bruce, however the brand has never worked).

If I was wearing the big sombrero I would

1. Put a hold on cuts for 5 years.

2. Develop a value matrix on each cigar and brand (a matrix which takes into account a weighting on /heritage/profitability/goodwill).

3 Put together a simple 3 year "revitalization program" for cigars which fall under the matrix thresh hold required.

4 Cut them in the 5th year if they don't measure up.

[bunburyist]

Nothing concrete. I know last year 12 cigars were saved from the "cut" list and I can only forsee the pressure this year to be even more. Sancho Panza survived by the skin of its teeth. Quai D'Orsay was another.

Personally I would cut:

Monte Open (...if you cut now HSA people may only remember it as a bad dream)

Vegueros (Sorry Bruce, however the brand has never worked).

If I was wearing the big sombrero I would

1. Put a hold on cuts for 5 years.

2. Develop a value matrix on each cigar and brand (a matrix which takes into account a weighting on /heritage/profitability/goodwill).

3 Put together a simple 3 year "revitalization program" for cigars which fall under the matrix thresh hold required.

4 Cut them in the 5th year if they don't measure up.

I think that's a reasonable approach. 5yrs might be a bit long to appease the accountants, but I suppose you need it in terms of developing blends etc. I'd love to see more brands sticking more closely to their 'house flavour profile'. Not so much a problem with the big brands, but the lesser ones are hit and miss. I might pick up a box of Molis then, if SP is on the way out.

You would assume that HSA have a similar system of evaluation to the one you mention above, but who knows. Judging by the haphazard path they seem to have walked so far......perhaps not

But the Monte Opens for sure. Is a bit like Aston Martin's recent idea to develop a small city-car based on the Toyota IQ or whatever it's called. Why!?!?! Selling out for short-term gain almost always has negative impacts in the long run.

[El Presidente]

Thanks to you Piggy

The boys in Havana would be choking on their Mojitos at the thought I was perceived as a corporate hack! I am still being blamed for the Monte Opens less than stellar market launch

We all love an analogy.

I am a major vineyard with a small section of vines growing a grape variety which no one seems to want any more. I can make some outstanding fortified wine with this grape variety but the days of fortified wine appear behind us. I struggle to keep up with yielding enough of my other grapes to meet the demand of Cohiba Chardonnay VI and Partagas P2 Shiraz. Worse, the world market this year has seen my sales down 30%. The wines keeping me afloat are my top 20. Do I rip up my Fortified vines and plant Chardonnay and Shiraz or look somehow to reinvigorate the fortified market? What I do know is that I cannot leave it as it is........once upon a time maybe....but now I have shareholders.

[PigFish]

Thanks to you Piggy

The boys in Havana would be choking on their Mojitos at the thought I was perceived as a corporate hack! I am still being blamed for the Monte Opens less than stellar market launch

We all love an analogy.

I am a major vineyard with a small section of vines growing a grape variety which no one seems to want any more. I can make some outstanding fortified wine with this grape variety but the days of fortified wine appear behind us. I struggle to keep up with yielding enough of my other grapes to meet the demand of Cohiba Chardonnay VI and Partagas P2 Shiraz. Worse, the world market this year has seen my sales down 30%. The wines keeping me afloat are my top 20. Do I rip up my Fortified vines and plant Chardonnay and Shiraz or look somehow to reinvigorate the fortified market? What I do know is that I cannot leave it as it is........once upon a time maybe....but now I have shareholders.

... as an apple farmer I choose to replace the red apples that have been declining in price by grafting my rootstock with cuttings of a new apples; one of various shades of red and yellow. In the years it takes the crops to bare fruit and again become profitable other farmers do the same. My first crop of trendy apples is met by stiff competition due to the other farmers following the trend. My new apples are good for little more than juice. Unfortunately the new apples have less sugar than my reds did and the juicer pays even less for them because they need to be fortified with sugar to meet his needs costing him money. He says he preferred the reds!

I learn the hard way that trends are not for followers but leaders. I also learn that the grass not always greener on the other side of the fence and not to put all my eggs in one basket. -Piggy

You hack! -LOL

[neal875]

Nothing concrete. I know last year 12 cigars were saved from the "cut" list and I can only forsee the pressure this year to be even more. Sancho Panza survived by the skin of its teeth. Quai D'Orsay was another.

Personally I would cut:

Monte Open (...if you cut now HSA people may only remember it as a bad dream)

Vegueros (Sorry Bruce, however the brand has never worked).

If I was wearing the big sombrero I would

1. Put a hold on cuts for 5 years.

2. Develop a value matrix on each cigar and brand (a matrix which takes into account a weighting on /heritage/profitability/goodwill).

3 Put together a simple 3 year "revitalization program" for cigars which fall under the matrix thresh hold required.

4 Cut them in the 5th year if they don't measure up.

Ahhh, the thread that never ends. It is a good one, though.

There is only a finite amount of resources available to any company. Financial resources, human resources, intellectual resources. All finite. It is why I wouldn't spend a dime on supporting brands or cigars that have shown more than three consecutive years of sales decline. Period. It is extremely rare that a product of any kind with this performance history is ever truly 'revitalized'. And the cost of attempting to do so is questionable in good economic times and a non-starter in bad ones. It is tough and just not very cost-effective to try to get people to buy what they don't want to buy once they decide that that is the case. I keep picturing Ken's review of the Petit Punch as an example of this.

Any marketing group worth its salt is going to use most of its available resources to promote best-sellers and use that gained equity to create maximum profitability. Ultimately, if I have $1MM dollars to market Habanos products, I too would use it to create additional interest in the most successful cigars and use the resulting trickle-down to work its magic on improving the performance of the rest of the lines. Think about it: This is probably how most of us got started with this obsession in the first place. I doubt more than a few of us began with anything other than a Montecristo, Cohiba, or Partagas. And, our later discovery of--and love for the more niche brands was a result of being exposed to those flagships first. That's just how it works. What can I say? But once a product is in a free-fall, it is almost always best to let it go. And, for the most part, we don't need a five-year attempt to discover whether a declining product will survive when we have a large portfolio of winners already. Even if one of those might still have some life in it somewhere. It is just not very good risk-management-- or use of available resources.

And therein lies the good news. Because Habanos has some real hit products. Real flagship lines. Flagships like Montecristo and Cohiba , for example, are any corporation's dream-come-true. These lines create the preference, the buzz and the bragging rights and that is what Habanos seems to be trying to capture with their current actions in the product development, consumer PR and advertising spaces. Promoting these flagships, as well as Habanos unique approach to the marketplace (its history, flavor, breadth, expertise and mythology), will continue to remind all of us-- and those that have not yet joined the ranks-- of exactly where the best cigars come from. And that will contribute greatly to creating value and additional pricing power. Because at the end of the day, it is not just about sales, it is about profitability. And pricing power resides with brands that create the most value for their products. Don't think so? Try to get a discounted Opus X or Padron 1926. Or a discounted bottle of Opus One, for that matter. It's not all that easy to do in most markets.

Finally, if we really believe that niche brands like SP and RG have a rightful place in the portfolio, then we need to create a place for them to reside in that portfolio. A place where they can contribute to the overall performance of the parent company. Perhaps a 'Habanos Vintage Selection' or 'Habanos Classic Selection' group could be launched to market some of these forgotten treasures with a platform that gives them a reason to be there and, at the same time, give them a real chance at creating value and profitability. This kind of positioning has worked very well for some of the Dominican and Nicaraguan cigar giants. Could work here too.

It is going to take some serious outside-the-box thinking to reach the objective of protecting Habanos' market share and profitability. I hope that this thinking is taking place somewhere-- alongside the necessary thinning of the herd. Because, if not, all that is left is raising prices to make up for lost sales. And that is always a bad cycle to get yourself into.

[Ken Gargett]

The boys in Havana would be choking on their Mojitos at the thought I was perceived as a corporate hack! I am still being blamed for the Monte Opens less than stellar market launch

We all love an analogy.

I am a major vineyard with a small section of vines growing a grape variety which no one seems to want any more. I can make some outstanding fortified wine with this grape variety but the days of fortified wine appear behind us. I struggle to keep up with yielding enough of my other grapes to meet the demand of Cohiba Chardonnay VI and Partagas P2 Shiraz. Worse, the world market this year has seen my sales down 30%. The wines keeping me afloat are my top 20. Do I rip up my Fortified vines and plant Chardonnay and Shiraz or look somehow to reinvigorate the fortified market? What I do know is that I cannot leave it as it is........once upon a time maybe....but now I have shareholders.

you've stumbled on a real one - take jim barry. makes brilliant clare valley riesling and some cracker reds.

had a patch of vines that made lovely fortifieds - the 'sentimental bloke' VP - the 1975 was one of the first wines i ever bought and happened to get a chance to try it a few weeks ago. still singing. but the barry's got about $5 a bottle for it. not bad in those days but could not make it every year so even though a joy to drink and something a bit different, it had to go and the grapes have ever since been used for a straight shiraz - something australia is hardly lacking. that said, it is the armagh shiraz and one of our top wines and the barry's now get around $180 plus a bottle.

what do you do?

and i'd like to think you had help with the monte opens.

[El Presidente]

neal 875 (Marc) I have really enjoyed your posts on this subject

Regardles if you are Piggy, or yoursely or Bunny or ken or Colt the one thing that Habanos has going for it is the passion shown by its zealots.

Excluding a few "gems" HSA is poorly managed (I agree with Ray). Your "Heritage Scheme" is something that we have been trying to get up for 4 years. I am all for dropping the LE and releasing a "Heritage Release" every year. Imagine a LFDC Short Churchill for 2010 or a PL Magnum!

I personally have no interest in the 2009 LE H Upmann Magnum 48. I would climb the walls for a PL Magnum! A cigar with history, with a story, with passion.

The marketing of cigars is not whitegoods or electronics. Yes it shares essential similarities (the requirement for profitability) but it also has history and passion.

Im my mind the road to real profitability is the re-engagement with its history and passion.

Would any of us really mind if we lost Sancho Panza, Quai D'Orsay, Party Lonsdale/Corona etc to a Heritage Program? In rotation every year 5 cigars from the past would come and bless our humidor and not at a massive markup?

I would give up the whole LE concept in a heart beat and exchange it for a Heritage Program.

[Guest rob]

Aside from cigars, I'm also a hifi and home theater aficionado.

Pioneer Plasma TV panels have long been accepted amongst purists as being amongst the very best on the planet. Since inception, they have produced the highest quality Plasma panels which every other manufacturer would love to emulate.

From all accounts, even though they were more expensive than rival brands - Pioneers where good sellers.

Earlier this year Pioneer put out a press release that said, effective immediately, they were cutting Plasma TV production to ZERO.... My heart sank when I read that press release.

Pioneer executives and bosses cared little for reputation, quality, and benchmark status.

It was all about the bottom line. Pioneer's TV panels just didn't sell as well as their other product lines.

Profit, Dinero, Moola, Spodoolies.... as always, was the deciding factor.

[Ken Gargett]

Would any of us really mind if we lost Sancho Panza,

didn't we just do this?

and yes.

[neal875]

Aside from cigars, I'm also a hifi and home theater aficionado.

Pioneer Plasma TV panels have long been accepted amongst purists as being amongst the very best on the planet. Since inception, they have produced the highest quality Plasma panels which every other manufacturer would love to emulate.

From all accounts, even though they were more expensive than rival brands - Pioneers where good sellers.

Earlier this year Pioneer put out a press release that said, effective immediately, they were cutting Plasma TV production to ZERO.... My heart sank when I read that press release.

Pioneer executives and bosses cared little for reputation, quality, and benchmark status.

It was all about the bottom line. Pioneer's TV panels just didn't sell as well as their other product lines.

Profit, Dinero, Moola, Spadoolies.... as always, was the deciding factor.

Rob (Prez): Thanks for the kind words.

Rob: It is so interesting that you bring up this example of Pioneer Plasma. Pioneer is a company and a culture that is both professionally familiar and very close to me and has been for more than a decade. And while the demise of Pioneer Plasma is the most recent example of real-world product marketing, this same company also took similar steps more than a decade ago with the world's most critically acclaimed video playback format: Laserdisc. One day, they just stopped making them and that was that. Gone. Worldwide. A format that they invented, marketed and closely aligned with the very values and history of the brand. You should have heard the screaming and whining from the public and the press about how we were selling out quality for short-term profit. And, they were right in saying it. But, had Pioneer not done it, they wouldn't have had the money or bandwidth to develop their somewhat successful Home Theater program of the last 15 or so years. A program that saved their bacon, such as it is. Laserdisc was a money pit and a drag on the brand. It was clearly not being embraced in sufficient numbers by the home theater customer and nothing that was done to change that seemed to work. As a result, it demoralized the people responsible for selling and marketing it and kept the mainstream customer from getting the product development and improvements that they deserved from this great brand. It could have been a disaster.

Keep in mind too that in addition to being a key component of Pioneer's legacy, Laserdisc was also a unique and much applauded format that made videotape seem like amateur night. It was embraced by the greatest actors and directors who publically endorsed it. Movie critics all backed it as did most of the consumer electronics press. It was objectively and subjectively the best way to watch and listen to a movie at home. But, just like the Monte 4 vs. the the Partagas PC, tonnage won and a slower-selling favorite of many was the loser. And, what's even more interesting is that you cannot find even a trace of evidence from Pioneer these days that Laserdisc ever existed. When its gone its really gone. Can you say Partagas Lonsdales?

It was during those days when I learned the mantra that helps guide me through the mine field that is my current business life. And that mantra goes like this: 'Everything you say YES to, you say NO to something else. So, when we say yes to saving a loser without any strategy for doing it, we say no to giving full support to one or more of our winners. And, when you project that kind of thinking out across five or ten years of a business cycle, it can really hurt you. This litmus test helps to keep me focused on the real prize--which is the ability to stay in business and to continue to serve our customers in the future. Which is what we all want for Habanos (and Pioneer) to do as well.

Rob: Thanks for bringing up this great example of what we're all having fun discussing in this thread.

And so it goes...

[bunburyist]

Rob (Prez): Thanks for the kind words.

Rob: It is so interesting that you bring up this example of Pioneer Plasma. Pioneer is a company and a culture that is both professionally familiar and very close to me and has been for more than a decade. And while the demise of Pioneer Plasma is the most recent example of real-world product marketing, this same company also took similar steps more than a decade ago with the world's most critically acclaimed video playback format: Laserdisc. One day, they just stopped making them and that was that. Gone. Worldwide. A format that they invented, marketed and closely aligned with the very values and history of the brand. You should have heard the screaming and whining from the public and the press about how we were selling out quality for short-term profit. And, they were right in saying it. But, had Pioneer not done it, they wouldn't have had the money or bandwidth to develop their somewhat successful Home Theater program of the last 15 or so years. A program that saved their bacon, such as it is. Laserdisc was a money pit and a drag on the brand. It was clearly not being embraced in sufficient numbers by the home theater customer and nothing that was done to change that seemed to work. As a result, it demoralized the people responsible for selling and marketing it and kept the mainstream customer from getting the product development and improvements that they deserved from this great brand. It could have been a disaster.

Keep in mind too that in addition to being a key component of Pioneer's legacy, Laserdisc was also a unique and much applauded format that made videotape seem like amateur night. It was embraced by the greatest actors and directors who publically endorsed it. Movie critics all backed it as did most of the consumer electronics press. It was objectively and subjectively the best way to watch and listen to a movie at home. But, just like the Monte 4 vs. the the Partagas PC, tonnage won and a slower-selling favorite of many was the loser. And, what's even more interesting is that you cannot find even a trace of evidence from Pioneer these days that Laserdisc ever existed. When its gone its really gone. Can you say Partagas Lonsdales?

It was during those days when I learned the mantra that helps guide me through the mine field that is my current business life. And that mantra goes like this: 'Everything you say YES to, you say NO to something else. So, when we say yes to saving a loser without any strategy for doing it, we say no to giving full support to one or more of our winners. And, when you project that kind of thinking out across five or ten years of a business cycle, it can really hurt you. This litmus test helps to keep me focused on the real prize--which is the ability to stay in business and to continue to serve our customers in the future. Which is what we all want for Habanos (and Pioneer) to do as well.

Rob: Thanks for bringing up this great example of what we're all having fun discussing in this thread.

And so it goes...

I don't think anyone would ever argue with the fact that if a product is losing you money, it needs to be modified, replaced or removed. The half-way house is that it's a shame to see some products that could be great, that could sell well, if only they were brought to market with the same gusto as some of the bigger brands. As I said above, marcas like LGC could easily be brought up a notch into 'mainstream' cuban cigar numbers. SP and RG....debatable. It's just a shame to see HSA focus on things like the Monte Open range instead (for all the abuse the Open gets....is it actually selling well? Are boxes flying off the shelves?).

So unless you believe the market is saturated with brands to the point where consumers can't handle any more, so it sould be futile to try, I think most people would like to see a more researched approach. All just opinion of course. Perhaps another analogy might help...

[Guest rob]

And, what's even more interesting is that you cannot find even a trace of evidence from Pioneer these days that Laserdisc ever existed. When its gone its really gone....

... I welcome you to my lounge room for a smoke, Neal. You will find hundreds of these laserdisc relics from the past! Never to be played again.

... and humidors that contains many, many fine (and not so fine) discontinued cigars.

I'm glad you appreciated the example. I expected it to be brushed over and ignored... but I really felt it was an accurate and appropriate example of how the corporate world thinks.

[Colt45]

A few members have brought up market share, and while I realize HSA can lose MS in the global cigar market, currently they cannot in

the Cuban cigar market. If Honda produces crappy cars, Toyota, Nissan, Mitsu, Suzuki, etc, will happily fill the void.

If my favorite wine producer from my favorite region in Italy starts to produce poor wines, or overvalue their product, there are numerous

producers to take their place. If I'm unhappy with the producers of Cuban cigars....... I have no alternative.

[PigFish]

A few members have brought up market share, and while I realize HSA can lose MS in the global cigar market, currently they cannot in

the Cuban cigar market. If Honda produces crappy cars, Toyota, Nissan, Mitsu, Suzuki, etc, will happily fill the void.

If my favorite wine producer from my favorite region in Italy starts to produce poor wines, or overvalue their product, there are numerous

producers to take their place. If I'm unhappy with the producers of Cuban cigars....... I have no alternative.

Bam! Nail on the head!

Habanos is not in a vacuum any longer. Better manufactured but lesser cigars are on their heels! Please read that carefully. Bettering manufacturing is a path to emulate. Better packaging (although a waisted resource on me) is a form of marketing and understandable. Emulating a company forced to create gimmicks to survive in the market... not a winning strategy.

Analogies here have largely focused on technology markets, or all or none markets, even my own. No offense gentlemen but I don't believe that you understand the nuances of this market or you are ignoring them to make a point.

The Habanos tree has room to bare many fruit... that is my argument. The tree exists and currently it has been shown that not all the fruit is eaten. There is no robbing Peter to pay Paul here! There is no resources shortage of tobacco or labor. This is a nationalized company! As Rob A. has stated... production is down 30 percent. You can't say that there is no tobacco for my cigars so this limited resources argument is not accurate to the position of the company. Cuba cannot get toilet paper, alright!!! But Cubans can wipe up with tobacco leaves... there is that much of it down there sitting around!!! Can we please abandon the limited resources comparisons; it is hogwash?

Cigars are not high technology. They do not have a computing speed life of 4 months. They don't compete in a yearly model change market and in that way they should be viewed more like Rolex than GM. At the beginning of WWII there were more than 1600 manufactures of exporting Cuban cigars**. Not makes, not models but manufactures!!! You might say that the past 60 years they have streamlined that down a bit.

I AM NOT AGAINST CHANGE. I am against bullshit. I am against being focused on inferior tasting products because I am TOLD they are better and there is no evidence to support it. I UNDERSTAND THAT THEY SELL BETTER, but market saturation is out there for those as well. You can overproduce the Mag 50 as easily as the Coronas!

Here is my LAST analogy. I enjoy classical music. All my favorite composers of same are dead. You might say that they are also out of style even archaic. The recording companies still produce the music. Yes, it is not as fashionable nor does it sell like Hip-hop but there is room for it in the market place. Like a good cigar the CD's might sit on the shelves of the retailer and wholesaler longer than the Hip-hop. Someone in that industry has got the smarts to realize that it is a core business and like the cigar the miniscule tooling changes that are required to produce the disks are worthwhile to keep the small segment of the music alive. The new products sell like crazy sure. But they require a huge marketing budget and must be supported by a huge marketing facade to keep it in place; it is also a high risk market segment as your star today may be convicted of murder tomorrow. Over the course of history it will likely be a transient trend. The Beetles still sell, so do the Stones, Pink Floyd, Beethoven, Bach and Vivaldi. There is still room for them in the market place.

Why was I picky over the detail, "those don't sell?" Because as a generalization, when classical music is compared to Hip-hop you could say the same about Beethoven. He does not sell.

Pick your analogies well my friends because we are talking more art than science here. We are talking more food than technology. The wine analogies are good ones but Cubatobacco is not a specialty grower. In the grand scheme of things Fuente is the specially grower and Cubatobacco is the mega-grower. There is product enough for cigarettes to lonsdales and canonazos!

All you streamliners out there; great textbook stuff. Tell me then, should we take Bach's Brandenburg Concerto off the market?

Rob... you are right. H SA should kiss my ass for the efforts and stoicism I demonstrate to zealously promote the products that they throw over!!!

**Perelman's Pocket Cyclopedia of Havana Cigars; Third Edition

[PigFish]

Thanks to you Piggy

The boys in Havana would be choking on their Mojitos at the thought I was perceived as a corporate hack! I am still being blamed for the Monte Opens less than stellar market launch

...another point! Are you responsible Rob??? -LOL Blaming you for the Monte Open is like blaming the Partagas Lonsdale for the loss of market share!!!

Beautiful Mate! Thank you! That is the likes of the company whose data is used to support arguments against me. -

[greenpimp]

If I'm unhappy with the producers of Cuban cigars....... I have no alternative.

Exactly, Colt. We honestly have no leg to stand on in our complaints. We'll ***** and moan and then buy more of the products we hope are still good. Luckily the overall quality of leaf and construction has increased over the past few years, and for that I give HSA accolades.

It seems to me this whole mess boils down fairly simply in the end, and the paradox is revealed there at the bottom of the pan. There is:

1-A small group of people who buy a large amount of cigars (honestly...us)

2-A large (HUGE) group of people who buy a very small amount of cigars.

It seems that the burgeoning market is made up of #2, the "uneducated masses" who buy a Cohiba or Montecristo because that's what they've heard of as being good (not that it isn't, it's just what they've heard of.)

Until #2's are converted to #1's, swayed to being "like us," then the market is driven by what #2 will buy. The conundrum is how to connect the two. Hopefully it is the great cigar that turns all the lights on, that all of us have had, and that will infect the young smoker who will try the other, "lesser" marquees as I have over the years and thereby save them.

Unfortunately, and as much as I appreciate the artwork, packaging and presentation are all that will point a new consumer to an "lesser" brand and I agree they must be reworked.

When the American market opens up, what will everyone buy out immediately? Don't kid yourself. Cohiba.

RA I do not envy your position but you handle it so very well and I thank you for it.

[Habanos2000]

It seems that HSA looks at the issue the same way Neal does in that they need to get the biggest bang for their buck, so cut the bottom 20% and move on. Easy decision, next....

But I agree that cigars are historical, even musical in a sense to certain people. And while some corporations just focus on the bottom line, there are other entities out there that want to fulfill a passion while happy to make a couple bucks instead of a couple hundred bucks.

I'd like to see HSA spin off/sell off the bottom 20% that they apparently consider dead already and have this 'heritage' group produced and supported by true lovers of cigar making and the cigar itself. There are individuals out there that love the business and not just the money. Hell, I bet if enough of members of this board chipped in we could make one hell of a product and prove it to be profitable!

[neal875]

It seems that HSA looks at the issue the same way Neal does in that they need to get the biggest bang for their buck, so cut the bottom 20% and move on. Easy decision, next....

But I agree that cigars are historical, even musical in a sense to certain people. And while some corporations just focus on the bottom line, there are other entities out there that want to fulfill a passion while happy to make a couple bucks instead of a couple hundred bucks.

I'd like to see HSA spin off/sell off the bottom 20% that they apparently consider dead already and have this 'heritage' group produced and supported by true lovers of cigar making and the cigar itself. There are individuals out there that love the business and not just the money. Hell, I bet if enough of members of this board chipped in we could make one hell of a product and prove it to be profitable!

It won't happen and it won't happen bacause this is not a hobby or art--it is commerce. I know very few successful companies that are fulfilling a passion in lieu of maximum profitability. And even fewer that knowingly design business models that generate a few bucks instead of a few hundred except for a few timely, iconic brand statements. If HSA would ever sell-off any of their underperforming stable (and for the first time create competition for themselves) it would be a significant, interesting and somewhat unlikely paradigm shift. But if it was to happen and a new company was formed to acquire and sell those bottom performing 20%, they will undertaking a business plan that really comes with enormous risk and little chance for payout. Keep in mind: Material, labor and overhead costs as well as costs of distribution will be the same as the costs associated with supporting the big names--maybe even higher because of limited economies of scale. Marketing costs will be dramatically higher as will sales promotion costs since these products are in no way demand items and will require a great deal of advertising and promotions actiivity to get them into the marketplace. And pricing elasticity is next to zilch for the aforementioned reasons. Remember: these brands didn't inhabit the Habanos basement without a good reason for being there and that perception has to be changed. Get out your wallet, my friends.

And, at the end of the day, where is the WHY BUY-- other than the fact that these forgotten brands somehow 'deserve' a second chance in the opinion of some. How do you create and launch a cost-effective business model for brands that are at the bottom of the heap of one of the world's best cigar marketing entities? Do you really beleive you have the expertise and deep pockets to do better? As I said earlier, Habanos is the ONLY company that has any reasonable chance of selling these slow-moving cigars by developing a real Habanos-driven business plan dedicated to doing just that. In fact, it will take separate brand management and other support just to get this up from being a tier-10 priority for the company, which is clearly the situation today. Vintage and Classic segments are just two of the possibilities. And they are really good ones. But there are others as well and those folks who are getting PAID to develop the Habanos business model should be thinking about ALL of them. We can only hope.

You know, with all this talk about how true lovers of the cigar culture are so determined to keep these brands alive--I wonder if it has resulted in an increase of any measure in purchase intent by our fellow members. I also wonder if there has been a rush to sit back and relax with an SP or Dip or RG since this thread started. I hope it has but I haven't seen that in any of the threads. It hasn't for me and I have all of them in the humidor. That despite the fact that none of these brands has brought about this outpouring of passion for as long as I have been on this forum. It is that passion that should result in a measurable uptick in the sell-through of these marques. But it is interesting to see boxes of SP Belicosos and Diplomaticos are still listed in the PSP section. And, if there has been more than 5 or 10% increase in purchase of these marques over the past couple of days or the next couple of weeks--I would be truly (and pleasantly) surprised.

This is the cigar BUSINESS that we are talking about. And the kind of proposed business plan discussed above makes no business sense. Now, if you have the kind of deep pockets that allows you to educate those who have only been exposed to the megabrands about what they're missing-- and can offer them a reason to reassign some of their budget to do so, then it might be the start of something good. But is it sustainable? When they get the brown and white labels, the antiquated packaging and no additional bragging rights, will they buy again? And again? I doubt that most will. And if the cost of acquisition makes the venture a margin killer, then who cares?

These brands need to be reinvented, repackaged and relaunched to have any chance of success. My point all along has been: Why? Every business deals with the 80-20 rule and you are seeing why it is a rule and not a theory, once again.

Stock up now and tell all your friends and kids about what 'used to be'. It helps to build mythology and interest in the current and future offerings just as a Gull Wing or Ferarri Daytona makes a current SL or 430 owner feel even better. Personally, I could LIVE on Trevor's remarkable website and most of what I look at is what I can't get anymore. The bands, the packaging, the cigars that are legends of the past. It is fascinating. It is why we are all here today. And keeps me hooked on the entire kabal called Cuban Cigars. Try and duplicate that kind of love and mythology with the Dominicans sometime and you know you are a part of something truly special.

I swear I am done with this thread. Please don't respond and make me write anymore. We're all right at the end of the day. But, it has been a great thread. Thanks to all for making it such.